Financial Management
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1) What are the components of cost analysis? In what situations would you use cost analysis versus price analysis? Why?
2) Is willingness to collaborate during negotiation important? How do you establish a negotiation strategy? What cultural differences should be considered when negotiating on a global basis?
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The response address the queries posted in 762 words with references.
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The response address the queries posted in 762 words with references.
//As per the directions, we will write about the 'Components of Cost Analysis'. We will also write about the situations in which cost analysis would be used versus price analysis. It will assist in understanding the importance of cost analysis. I have tried to include some major points. You are free to add some more points, which you find suitable.//
Components of Cost Analysis
Cost analysis refers to the assessment of the different elements of cost (such as, labor cost, material cost, distribution, etc.), which forms the basis for analyzing the overall cost involved in a project and assists in assessing the reasonability of the cost, as per the requirements (Cost and Price Analysis--An Explanation). The major components of cost analysis are described below:
Labor cost analysis: It involves the analysis of the wages and salaries, compensation benefits, insurance plans, etc.
Facility cost: It involves the analysis of the financing cost of ownership related with the purchase of assets.
Transportation cost: It differs with the differences in the type of industry. It also varies with the differences in the geographical locations.
Utility cost: It involves the analysis of the utility expenses on water, electricity, telecommunication, etc. Apart from this, the tax expenses are also analyzed by applying the cost analysis (Brent, 2006).
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Education
- MBA (IP), International Center for Internationa Business
- BBA, University of Rajasthan
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